Oyo Hotels, an Indian startup for booking hotel rooms founded by now 24-year-old Ritesh Agarwal, raised $1B in a round led by ol’ moneybags SoftBank.
By standardizing India’s inconsistent hotel landscape, Oyo has grown rapidly since it was founded in 2013 to become India’s 2nd-largest startup (after fellow SoftBank sugar-baby Paytm).
Oro started as a service that aggregates actual hotels — not private rooms. In India and other international hotel markets, there are often few options between expensive luxury rooms and unclean budget rooms, so Oyo hopes to make a middle option for middle-income travelers.
The company recruits small hotel owners to their platform, providing them with everything from linens and toiletries to staff training and an online listing in exchange for a 25% commission.
Unlike Airbnb, which strives to provide unique experiences with different hosts, Oyo strives to create a consistent experience by standardizing all its partner hotels and branding them with the Oyo name.
Mr. Agarwal launched Oyo 5 years ago when he was just 19. Since then, the company has branched out into China, Malaysia, Nepal, and Britain.
Since launching in China just 10 months ago, Oyo has expanded to 171 Chinese cities already — and it plans on using $600m of the $1B it raised to expand in China specifically.